April 14, 2015

President Obama’s Dubious Climate Promises

Editor’s note — Todays guest bloggers are the principals at Element VI Consulting.  Prior to founding Element VI, David Bookbinder was the Sierra Club’s Chief Climate Counsel and, among other things, he managed the Massachusetts v. EPA case.  David Bailey was Climate Policy Manager at ExxonMobil.

Announcing a goal (however eloquently) does not make it happen. The energy and environment field is littered with attempts to make change by legislative or administrative fiat, while ignoring the unpleasant hard realities of technology limitations and cost. The millions–if not billions–of gallons of cellulosic ethanol that motorists would be enjoying if the Bush administration’s RFS targets had come true is a perfect example. The Obama administration is equally adept (if not more so) at weaving such fantasies. Sadly, the latest U.S. steps in the UN climate negotiations once again reveal a disconnect between wishes (sorry, targets) and reality.

In November, the White House announced, as part of the U.S. – China climate agreement, that the United States would “commit” at the Paris talks to reducing our greenhouse gas emissions 26-28% below 2005 levels by 2025. We eagerly awaited the formal State Department submission that would describe just how this would be done, because we pointed out that the measures the Administration listed in the accompanying Fact Sheet at that time did not add up to the necessary reductions. Last week, the State Department submitted its formal “intended nationally determined contribution,” which ostensibly describes how we’re going to do this. Interestingly, it includes even fewer measures than the White House talked about in November, having been scrubbed of any mention of limiting methane emissions from coal mines or agriculture. To no one’s surprise, it falls dramatically short.

Let’s look at the numbers again in light of subsequent regulatory developments.

  • Total U.S. emissions in 2005 were 6,223 million metric tons (“MMT”) of CO2 equivalent, and 26% of that is 1,618 MMT.
  • By 2012, with the aid of major recession and a dash for gas in the power sector, we had reduced total emissions by 677 MMT (to 5,546 MMT).
  • So, to meet the 26% goal, at first glance it looks like we would need to cut another 941 MMT by 2025. (We use 2012 figures because that is the starting point for what we actually need to accomplish; all emissions numbers are from EPA’s 2014 Inventory of U.S. Greenhouse Gas Emissions and Sinks: 1990 – 2012, which is the most recent official U.S. report to the Paris process.)
  • But, as DOE points out, even with all the regulatory measures that were in place as of 2013, due to economic growth, their Reference Case emissions will increase by 236 MMT between 2012 and 2025 (EIA Annual Energy Outlook 2014, p. A-5).
  • Thus, to meet the 26% reduction target, we need to eliminate 1,177 MMT of annual emissions over the next ten years.

Here are the measures listed in the U.S. submission, and what EPA and DOE say (elsewhere, as predictably there are no numbers whatsoever in the submission) that the expected reductions will be:

1. Power plant emissions standards. Expected reductions by 2025: 506 MMT (79 FR 34932).

2. Landfill methane standards. Expected reductions from new landfills: 3 MMT (79 FR 42825). Expected reductions from existing landfills are very hard to calculate, as EPA has not even proposed any standards. However, given that current regulations have reduced these emissions by 30% between 1990 and 2012 (79 FR 41775), we’ll assume a further 50% reduction of the 2012 emissions 103 MMT (id.) for 52 MMT.

3. Oil & Gas exploration and production methane standards. Since, despite an announcement 15 months ago, EPA has not yet proposed regulations, we use the upper end of the White House goal of “40 – 45 percent from 2012 levels by 2025” (Administration Takes Steps Forward on Climate Action Plan by Announcing Actions to Cut Methane Emissions; White House Fact Sheet, January 14, 2015, p. 1) for expected reductions. 2012 emissions from natural gas systems and petroleum systems were, respectively, 130 MMT and 32 MMT (EPA Inventory, p. ES-6); 45% of 162 MMT = 73 MMT. (Note that because these standards will apply only to new facilities, they will have limited impact on current emissions, which are all from existing infrastructure.)

4. DOE energy conservation standards. This one is not easy to quantify, but we do our best. DOE has already completed 29 sets of standards for various equipment, appliances and building codes, with dozens more coming, and so we used the emissions difference between EIA’s Reference and “Extended Policies” projections. The former includes the measures DOE has already completed, and the latter includes “additional rounds of efficiency standards for residential and commercial products, as well as new standards for products not yet covered; adds multiple rounds of national building codes by 2026”. EIA, Assumptions to the Annual Energy Outlook 2014, p. 10.

EIA says that the cumulative emissions difference between the two cases from 2012 to 2040 is 2.6 billion metric tons (2014 Annual Energy Outlook, p. IF-7). We then subtracted the 11% of which is due to increased fuel economy and another 5% for the “relatively small” reduction attributable to increased renewable generation (id.), leaving a total of 2.2 billion metric tons reduced between 2012 and 2040, which works out to an average of 80 MMT/year. (This is a generous estimate, because annual savings will increase over time as new standards are added.)

5. HFC replacement program. Expected reductions: 31 to 42 MMT in 2020 (79 FR 46128); we’ll assume the upper end of that (42 MMT) as the 2025 number.

6. Reducing Federal Government emissions. Executive Order 13693, Section 1, calls for a 40% reduction from 2008 emissions by 2025. Those 2008 emissions were 70 MMT (Federal Progress Toward Energy/Sustainability Goals: Presentation to Federal Interagency Energy Management Task Force, May 22, 2014, pp. 14, 17). Forty percent of 70 MMT is 28 MMT; by 2012, those emissions were down 13 MMT (id.), leaving another 15 MMT to go.

7. Vehicle emission standards. The Administration’s list of measures also includes both the current light-duty and medium and heavy-duty vehicle fuel economy standards. While these will have respective reductions by 2025 of 140 MMT (77 FR 62892) and 76 MMT (by 2030; 76 FR 57294), including them would be double-counting, as EIA has already factored those reductions into its 2025 projections (Assumptions to the Annual Energy Outlook 2014, pp. 71, 80). The Administration also includes post-2019 medium- and heavy-duty vehicle standards but, again, there is no proposed rule; for argument’s sake we will assume these will achieve the same reductions by 2025 as the existing standards will achieve by 2030: 76 MMT.

We need 1,177 MMT in reductions to fulfill the U.S. commitment. Even assuming (1) that standards that have not yet been proposed (for existing landfills, oil & gas operations, heavy-duty vehicles and some DOE efficiency ones) become law and work as expected; (2) that those as-yet unknown standards produce exceptional results (e.g., 50% reductions for landfills and 45% for oil & gas); (3) that those standards plus all the ones that have been proposed but are not yet finalized (power plants, new landfills, and other DOE efficiency measures) are completed in a timely manner, survive judicial review and produce the reductions expected; and (4) that this or the next Administration does nothing to slow down or weaken any of them, then we’re looking at maximum annual reductions in 2025 of 847 MMT, leaving us 330 MMT short of even the lower end of our Paris “commitment”.

Good grief.